Koronis Biomedical Technology Corporation (KBT) proposes to develop a giant magneto-resistive (GMR) sensor for use in ultrathin bronchoscope navigation systems. Bronchoscopy is used to locate anomalies in a patient's bronchus and if necessary, take a biopsy. Unfortunately, the majority of target lung lesions are located in the peripheral areas of the lungs where large bronchoscopes cannot reach. Approximately 2/3rds of diagnostic bronchoscopy procedures in the lung's periphery fail and must be repeated or replaced with more invasive approaches such as fluoroscopic guided percutaneous needle biopsy or surgical biopsy. New ultrathin bronchoscopes provide physicians a tool capable of moving further into the reaches of the lung periphery. Ultrathin bronchoscopes are smaller than 3 mm in diameter, about half the size of a standard instrument. Commercial systems for bronchoscope navigation have been introduced that rely upon miniature magnetic field pick-up coils rigidly located within the bronchoscope to sense external reference magnetic fields. The wire-wound pick-up coils have substantial drawbacks including size, cost, and performance. They are generally too large for use in ultrathin bronchoscopes and are unsuitable for further miniaturization. The proposed program uses solid-state thin-film giant magneto-resistive (GMR) magnetic field sensors to reduce the size, increase the performance, and decrease the cost of bronchoscope navigation systems. The aims of the phase I program seek to demonstrate that a GMR sensor can be designed suitable for application in an ultrathin bronchoscope. The phase I program will design and prototype a GMR sensor which is small enough in size to be used in an ultrathin bronchoscope. The phase II program will manufacture the GMR sensor, and insert and evaluate it in a prototype bronchoscope navigation system. [unreadable] [unreadable]